In January, a packed audience at the Idaho Supreme Court listened intently as the Idaho Freedom Foundation made its final stand against voters’ decision to expand Medicaid to nearly 100,000 low-income Idahoans.
The Supreme Court’s ruling came just days after the hearing. It upheld Medicaid expansion, ruling against the Freedom Foundation.
The case was the libertarian think tank’s highest-profile legal challenge to a law the foundation says is unconstitutional — but it’s not the first.
The Idaho Freedom Foundation at one point envisioned adding a legal arm fashioned in the likes of the Goldwater Institute and the Institute for Justice. Those groups have turned to the courts to rule against government regulation when their efforts in the Legislature fail. The Freedom Foundation has even drawn from some of those groups’ networks and opaque donors to engage in their legal battles.
But the foundation’s constitutional arguments have not found the same kind of success in courts. Since the Freedom Foundation formed in 2009, it has gone to court five times to challenge the constitutionality of state and city laws or regulations. It has not won any of those lawsuits (one is still pending in court).
The only case the group has won was not a constitutional challenge. Its founder and president, Wayne Hoffman, sued Coeur d’Alene in 2009 to force officials to release public records.
One case was dismissed because it was filed after the statute of limitations. Judges dismissed two other lawsuits without a hearing because the Freedom Foundation, or the plaintiffs it brought to the case, could not show how they were harmed by the law.
The Freedom Foundation says it uses lawsuits to defend Idaho taxpayers.
A look into the Freedom Foundation’s lawsuits casts light on how the foundation taps into a network of conservative pro bono lawyers and donors for support, and uses lawsuits as a platform for its ideologies.
Network of conservative litigants
In the 1970s, as conservatives grew frustrated with environmental activists’ use of the courts to push for regulation, they started to organize their own litigation groups. Lewis Powell, a corporate lawyer later turned Supreme Court Justice, urged for a conservative counterattack that would advocate for deregulation. In an influential memo, he wrote, “The Judiciary may be the most important instrument for social, economic and political change.”
One group resulting from the strategy Powell outlined was the Mountain States Legal Foundation, financed by beer mogul Joseph Coors. In the late 1970s, the nonprofit law firm began to fight back against regulations on federal land use and natural resources.
In the years since, the Mountain States Legal Foundation has become an important legal ally to conservative groups throughout the West, including the Idaho Freedom Foundation. Mountain States represented the Idaho Freedom Foundation when it sued the Boise School District over its contract with a local teachers union, the Boise Education Association, in 2015. Boise lawyer John L. Runft, a member of Mountain States Legal Foundation’s board of litigation since 1977, is representing the Freedom Foundation in its lawsuit against the city of Boise’s use of urban renewal districts.
Both the Mountain States Legal Foundation and the Idaho Freedom Foundation receive funding from Donors Trust and Donors Capital Fund — two of the biggest tax-exempt funds that bankroll libertarian-leaning organizations but do not disclose their donors’ names. The two funds have previously received donations in large part from the libertarian, industrialist brothers Charles and David Koch, who have spent billions to push politics to the right.
Between 2010 and 2017, Donors Trust and Donors Capital Fund awarded a combined $698,100 to the Idaho Freedom Foundation and $386,200 to the Mountain States Legal Foundation.
The Idaho Freedom Foundation also belongs to the State Policy Network, a group of conservative think tanks funded by Donors Trust and Donors Capital Fund. Since 2009, it has received $313,350 from the State Policy Network.
Hoffman declined to say who funds the Idaho Freedom Foundation, but said that this year about 90 percent of its donations has come from Idahoans.
“There is no ATM from the Koch brothers,” he said.
In previous years, grants from Donors Capital Fund made up as much as 43 percent of the Freedom Foundation’s contributions. Public tax records show the majority of the foundation’s initial funding came from the State Policy Network. It also has received grants from the J.A. & Kathryn Albertson Foundation and the Adolph Coors Foundation.
The Idaho Freedom Foundation’s pockets are not as deep as some of its counterparts, though.
The foundation has a yearly budget of about $800,000, Hoffman said. Compare that to the Freedom Foundation in Washington, with a budget of $4 million, or the Wyoming Liberty Group, with a budget of $1.7 million, according to the most recent tax filings.
In part, Hoffman blames the group’s court defeats on its limited budget.
“I’m a little, tiny think tank with a little, tiny staff going up against the government and its vast resources,” he said. “This is exactly what David versus Goliath looks like.”
But the American Civil Liberties Union of Idaho, with a similar budget, has managed to find more success in the courts. It sues the state sometimes several times each year. Most cases have ended with either a settlement or in the ACLU’s favor.
The Freedom Foundation at one point aspired to be such a legal powerhouse. In 2014 it created the Center for Legal Defense, which seems to have existed for just a year. Announcing the project, Hoffman wrote: “IFF is constantly battling statism and overreach by government in Idaho. Having the ability to stand up for Idahoans through the courts was the next logical step for this organization.”
Sometimes threatening legal action is enough to work in an interest group’s favor. In 2014, the Freedom Foundation and the ACLU banded together against Boise State University when it forced a student group to pay security fees for bringing a pro-gun speaker to campus. No lawsuit entailed, but after drawing attention to the issue and threatening legal action, Boise State refunded the student group the security fees.
In a recent interview, Hoffman said the Freedom Foundation’s main avenues of influence are still lobbying legislators and educating voters. It grades lawmakers’ bills on its “freedom” scale, scoring bills that reduce government regulation higher.
He noted that his group has brought cases to the court less than once a year.
“Whenever you take on a case, there’s a real risk to the organization that it’s going to deplete our entire treasury,” Hoffman said. “You have to be very careful. You can’t just file things frivolously.”
The Freedom Foundation’s lawsuits have cost the state. According the the Attorney General’s Office, the state spent about $30,000 to fight the Medicaid lawsuit and $20,000 to fight a 2016 Freedom Foundation lawsuit that sought to throw out some of Idaho’s standardized tests after legislative initiatives failed to do so.
Litigation for influence
The Supreme Court was the Freedom Foundation’s last chance to block Medicaid expansion. Despite campaigning against Prop 2 throughout the election season, 61 percent of voters supported it in the November election.
Hoffman backed the lawsuit. “It’s to defend taxpayers, it’s not to defend mob rule at the ballot box,” he said.
Lawsuits that go against the majority sometimes serve an important role in moving the needle on social issues — such as the Supreme Court’s ruling in Brown v. Board of Education, which barred racial segregation of schools.
Catherine Albiston, a law professor at the University of California at Berkeley, has studied how litigation can be used to advance social movements and prevent majority oppression of disadvantaged groups. Even if lawsuits end in defeat, she said, they can pay benefits like attracting funding and keeping the debate on the public agenda.
Arguments that Bryan Smith, the Freedom Foundation’s lawyer in the Medicaid case, made in court are echoing in the halls of the Capitol in Boise.
Smith argued that expansion was unconstitutional since the federal government could reduce its commitment to fund 90 percent of the cost of Medicaid expansion. That would change what voters believed they were authorizing.
The court didn’t buy his argument. But some language in bills recently brought before the House Health and Welfare Committee include language that would nullify Medicaid expansion if the federal government lowers its contribution.
Rep. Fred Wood, R-Burley, chairs the House Health and Welfare Committee. He said that the provision was not influenced by the Freedom Foundation trial but included for budgetary reasons.
But is the provision necessary? Rep. Maryanne Jordan, D-Boise, said it’s not, because if the federal government reduces its funding, the Legislature would still have to vote to authorize an increase to the state’s contribution.
Steve Symms, a former U.S. senator from Idaho, said the group’s lawsuits still may have value.
“Whether they win or lose, maybe they’ve won just by getting people to talk about it,” he said.